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So after reading that Nintendo made the decision with DLC characters, my thinking has changed. I think they're going to pick characters from previously released and upcoming Switch games, with one big third party rep.

I think the odds of seeing Rex/Pyra (with Mythra as an alternate skin) have jumped; personally I'd like to see Lora & Jin with the option to switch which character you're playing as (like the Pokemon Trainer's ability to swap Pokemon), and a stage based on Auresco, but Rex & Pyra are the main characters of the overall game so I think we'll be getting them. I also think Nintendo making the choices increases the odds of Edelgard joining, as well as a generation 8 Pokemon, and some kind of Arms representation - likely Twintelle. I still think we're going to get a big, Japan focused third-party character - I think a Hero from Dragon Quest is likely, with a stage based on Dragon Quest XI.

So:

1) Rex/Pyra (with Mythra as a skin) - Stage: Alrest - You fly around Alrest on Azurda/Gramps' back, seeing different locations from the game. I don't think we'll get a Gormott stage, it's too similar to Gaur Plains.
2) Twintelle - Stage: Cinema Deluxe.
3) Edelgard (axe/magic) - Stage: Location from Three Houses (I was going to say the castle hub, but that would be a bit samey)
4) Generation 8 Pokemon - Stage: Generation 8 location
5) Hero (Dragon Quest - alternate skins represent alternate heroes) Stage: something from DQ XI